Brussels (Brussels Morning) German government incentives aimed at encouraging companies to keep their workers on the payroll despite the coronavirus pandemic seem to have generated an unexpected boost to employment figures in January, Reuters reports.
The number of unemployed people in Europe’s largest economy dropped by 41,000, to 2.7 million. In a previous Reuters poll, experts had predicted that unemployment would grow, with an expected average of some 6,000 jobs lost.
According to the Germany’s Labour Agency, some 2.26 million people were working on shortened working hours in November, as part of the government’s “short work” (Kurzarbeit) scheme. The scheme was put in place to prevent mass layoffs during the economic downturn. Government subsidies were offered to companies that retained their workforces despite the diminished volume of work.
“The labour market remains in a robust condition in January,” Labour Agency head Detlef Scheele declared. “But the measures in place to tame the coronavirus pandemic are leaving a mark.”
The German economy is currently in its second lockdown since mid-December. Federal and regional governments recently agreed on an extension and to strengthen the measures, keeping more workers at home and slowing down the economic turnover.